Deck 7: Business Marketing

Question 1

A keiretsu is an example of how companies can develop into a network of interlocking corporate affiliates.

Answer 1

True

Question 2

The emergence of the Internet has made buying and selling in the business market a process that is only efficient for the largest producer to pursue.

Answer 2

False
Even the smallest businesses are finding they are able to compete successfully with their largest competitors as a result of the Internet.

Question 3

NAICS is an industry classification system used by most nations of the world.

Answer 3

False
As its name indicates,NAICS (North American Industry Classification System)has been adopted only by Mexico,Canada,and the United States.

Question 4

If DuPont runs advertisements encouraging people to buy clothing that contains Lycra (a DuPont product),this would be an attempt to influence secondary demand.

Question 5

OEM stands for operationally efficient marketing.

Question 6

While consumer and business markets differ in many ways,the volatility of demand for products is about the same for each type of market.

Question 7

Another commonly used term for accessory equipment is installations.

Question 8

The reseller market is the same as the retailer market.

Question 9

The first two digits of a NAICS code designate an industry group,such as fiber,yarn,and thread mills.

Question 10

The Internet has eliminated the need for distributors.

Question 11

The government sector (federal,state and local)is a minor segment of the business market

Question 12

The single largest customer in the world is the U.S.federal government.

Question 13

Individual producers of raw materials have great flexibility in pricing their products.

Question 14

Any firm that purchases goods and services to make a profit by using them to produce other goods is part of the producer segment of the business market.

Question 15

Shimano sells the fishing and golfing equipment it manufactures to sporting goods stores,which in turn sell the equipment to anglers and golfers.Shimano is engaged in business marketing.

Question 16

A decline in the availability of tungsten will slow production of light filaments,which will in turn reduce the demand for light bulbs.This is an example of fluctuating demand.

Question 17

Unlike consumer product channels of distribution,which usually have one or more intermediaries,channels of distribution for business products are often direct.

Question 18

Most business marketers emphasize personal selling as their primary communications tool.

Question 19

For a product to be called a business product,it must be used to manufacture other products,become part of another product,or facilitate the normal operations of a firm.

Question 20

Items that are ready for assembly and that retain their identities when incorporated into another product are called component parts.

Question 21

Since GE began accepting bids via the Internet,the length of the bidding process in GE's lighting division has been reduced from 21 days to 10.Since requesting the bids is easier,purchasing agents approach more potential vendors.The ability to locate more vendors has lowered the cost of goods by 5 to 15 percent.GE's experience illustrates:

A) how using the Internet decreases competition
B) how business marketing is becoming global
C) how business marketing is using the Internet to become more efficient
D) how the use of the Internet has influenced consumer markets to become larger and more powerful than business markets
E) how the Internet increases efficiency in data exchange

Question 22

_____ is the marketing of goods and services to individuals and organizations for purposes other than personal consumption.

A) Secondary marketing
B) Interactive marketing
C) Business marketing
D) High-level marketing
E) Industrial marketing

Question 23

If Ford purchased the same number of brakes from NUCAP on a regular basis,it would be participating in a straight rebuy.

Question 24

A product is defined as a business product rather than a consumer good on the basis of its:

A) intended use
B) physical characteristics
C) price
D) distribution method
E) tangible attributes

Question 25

All of the following are current roles of the Internet in business marketing EXCEPT:

A) reduce costs
B) eliminate distributors
C) build partnerships and alliances
D) build and support branding
E) integrate online and traditional media

Question 26

Which of the following means that a firm believes that an ongoing relationship with some other firm is so important that it warrants maximum efforts at maintaining it indefinitely?

A) amae
B) trust
C) relationship quality
D) strategic alliance
E) relationship commitment

Question 27

The elimination of intermediaries such as wholesalers or distributors from a marketing channel is referred to as:

A) disintermediation
B) disassociation
C) unencumberance
D) demarketing
E) selective retention

Question 28

The role of gatekeeper may be filled by a receptionist.

Question 29

Although customer service has in the past been an important factor in business buyer-seller relationships,its importance has been waning in the last decade.

Question 30

_____ is a measure of a Web site's effectiveness and is calculated by multiplying the frequency of visits times the duration of a visit times the number of pages viewed during each visit.

A) Effective reach
B) Effective frequency
C) Gross rating points
D) Interactiveness
E) Stickiness

Question 31

Sometimes a _____ is created for the purpose of sharing resources.This was why the Donnelly Corporation,a company that designs,manufactures,and markets automotive parts,joined with Applied Films Laboratory,Inc.to manufacture and supply the world market with display coated glass for liquid crystal displays (LCDs).

A) shared capital contract
B) global partner development strategy
C) strategic alliance
D) cobranding effort
E) market cooperative

Question 32

The Solar Group,a Mississippi-based mailbox manufacturer,sells mailboxes to contractors who are building mega-subdivisions,to hardware stores,and directly to new homeowners.What kind of products is the Solar Group selling?

A) business products only
B) both business and consumer goods
C) installations
D) consumer goods only
E) supplies

Question 33

Which of the following is the best example of a sale that could only take place in the business market?

A) A professor is purchasing a Mac to use at home
B) A music store owner is ordering the newest Elvis Ultimate Live collection DVD for her mother
C) A teen is purchasing ring tones to use on her phone
D) A librarian is purchasing new books for the school's library
E) All of these are examples of business sales

Question 34

The reintroduction of an intermediary between producers and users is called:

A) disintermediation
B) reinstatement
C) selective retention
D) reestablishment
E) reintermediation

Question 35

Business marketing does NOT include goods and services that:

A) become part of another product
B) are used to manufacture other products
C) are used for personal consumption
D) facilitate the normal operations of an organization
E) are acquired for resale

Question 36

Consumable items that do not become part of the final product are called supplies.

Question 37

Because formal committees are often established to purchase business products,members of buying centers can be readily identified on formal organizational charts.

Question 38

A cooperative agreement between business firms is a:

A) shared capital contract
B) global partner development strategy
C) strategic alliance
D) joint contract
E) comarketing effort

Question 39

Before toll-free telephone numbers and the Internet were used as commercial tools,fliers usually purchased airline tickets from travel agents.Travel agents no longer receive a commission from the airlines for selling tickets to consumers.This is an example of:

A) reintermediation
B) disassociation
C) disintermediation
D) discrimination
E) transference

Question 40

IBM and Cisco work together to provide banks with the products and services they need to manage their multiple locations.In other words,the two companies have joined in a:

A) retail cooperative
B) direct investment venture
C) transactional relationship
D) strategic alliance
E) synergistic relationship

Question 41

DHL maintains a strategic alliance with UPS because it has confidence in UPS's reliability and integrity.This condition is referred to as:

A) trust
B) tomo
C) commitment
D) amae
E) reciprocity

Question 42

Southern Fireworks Manufacture Company in Liuyang,China provides fireworks for companies in America such as Premier Pyrotechnics in Richland,Missouri.This means that Southern is a (n):

A) installer of original materials
B) demand company
C) a reseller
D) government buyer
E) OEM

Question 43

In the past 24 years,Mothers Work has grown from a small,mail-order catalog business headquartered inside the founder's home,to the world's largest seller of maternity apparel,with nearly 1,600 locations.In terms of the business market,Mothers Work would be best classified as a(n):

A) reseller
B) producer
C) distribution network
D) inventory carrier
E) business facilitator

Question 44

Imagine you are the research director of a major industrial marketing firm.You need to select an NAICS code that defines the most homogeneous group of companies in a particular group of highly competitive companies .Which of the following codes might you use?

A) 7432
B) 532
C) 19
D) 7
E) 999

Question 45

A particular segment of the business market includes those individuals and organizations that purchase goods and services for the purpose of making a profit.They achieve this goal by using purchased goods and services to make other goods,to become part of other goods,or to facilitate the daily operations of the organization.This group is called the _____ segment of the business market.

A) institution
B) reseller
C) wholesaler
D) producer
E) government

Question 46

Hensley Poultry is a wholesaler that buys poultry food and health products from Provini,Inc.,feeding systems from Big Dutchman,Inc.and incubation systems from Copca Corp.Hensley then sells those products to poultry producers and farmers' cooperatives in Iowa.Hensley Poultry could be best classified as a(n):

A) producer
B) distribution network
C) inventory carrier
D) specialty retailer
E) reseller

Question 47

Which of the following is the BEST example of an institution market?

A) The Government
B) eBay
C) Claire's Boutique
D) United Methodist church
E) Starbucks

Question 48

Businesses that buy finished goods and sell and distribute them for a profit are called:

A) inventory carriers
B) producers
C) distribution networks
D) resellers
E) business facilitators

Question 49

Organon Teknina sells inexpensive equipment to detect E.coli,listeria,or salmonella bacteria in food.The company serves not-for-profit institutions that need to regularly check food quality.Organon Teknina would be LEAST likely to sell to:

A) Montgomery County school system
B) a large pediatric hospital
C) a chain of Mexican restaurants
D) a chain of church-sponsored retirement homes
E) American Red Cross emergency shelter kitchens

Question 50

The government uses a system called NAICS to classify North American business establishments.NAICS stands for:

A) Non-American Industry Classification System
B) North and South American Institutional Coding Services
C) Non-American Industrial Corporation System
D) North American Institution Code System
E) North American Industry Classification System

Question 51

According to the text,another commonly used name for producers is:

A) fabricators
B) installers
C) original equipment manufacturers
D) product providers
E) component networks

Question 52

The U.S.government is:

A) not a business market segment
B) the world's largest single customer
C) an organization accounting for over 50 percent of the U.S.gross national product
D) mainly a military equipment purchaser
E) using one centralized purchasing office for the entire government

Question 53

What would a U.S.company that manufactures the lighted signs used in amusement parks,at outdoor sports arenas,for restaurant promotion,and by state departments of transportation on the sides of roads use to facilitate its market segmentation and targeting if it wanted data that were readily available and usable?

A) a large amount of marketing research,including scanner data and focus groups
B) other competing firms as a strategic alliance referral service
C) government bidding processes
D) the North American Industry Classification System
E) derived demand

Question 54

In Japan,reciprocity and personal relationships contribute to the development of:

A) global ventures
B) amae
C) agricola
D) keiretsu
E) an independent network of small retailers

Question 55

Corn refiners buy shelled corn and convert it into a variety of products,including high fructose corn syrup.The refiners then sell the syrup to soda and food product companies for use in foods and beverages.The corn refiners represent the _____ sector of the business market.

A) channel
B) reseller
C) producer
D) government
E) distributor

Question 56

One segment of the business market has primary goals that differ from the ordinary business goals such as profit,market share,or return on investment.This segment includes many schools,churches,and civic clubs and is often called the _____ market.

A) institution
B) OEM
C) service
D) provider
E) reseller

Question 57

Ed Rodney works for the state of Minnesota as a advocate of state growth and development.He devises ways to encourage businesses to relocate to the state.In other words,Rodney is involved in business marketing.He is compiling a list of potential businesses that might be willing to move their operations to Minnesota.Which of the following possible clients should he include in his list?

A) any family that takes an annual vacation
B) newlyweds
C) families that enjoy hiking
D) companies that have growing sales
E) students on spring break

Question 58

A keiretsu is a(n):

A) type of strategic alliance commonly found in Japan
B) method of business e-commerce found in Asia
C) Internet site that offers its customers access to various languages that they can use to conduct their business
D) form of relationship marketing that is illegal in the United States
E) bribe

Question 59

NAICS data are helpful for analyzing,segmenting,and targeting markets.The system was developed by:

A) large manufacturers in United States and Mexico that produce similar goods
B) the North American Free Trade Agreement partners
C) Brazil,Chile,Argentina,Canada,and the United States working together in a joint venture
D) the SIC committee
E) the U.S.government

Question 60

Caterpillar,the manufacturer of earthmoving equipment,uses completed drivetrains (engines-transmissions-axles),drivetrain components,electronic controls,hydraulic and electrohydraulic components and systems,cooling systems,and undercarriage track systems produced by other organizations in its manufacturing process.Caterpillar is an example of a(n):

A) fabricator
B) installer
C) original equipment manufacturer
D) product provider
E) component network

Question 61

Due to rapidly rising overhead costs and increases in raw material prices,Framarx Corporation was forced to raise the price of its waxed and coated paper by 35 percent.(The paper is used between frozen hamburger patties to keep the patties from freezing together.)Framarx is the leading manufacturer in this industry,and its competitors will follow suit.While the sales force for Framarx believes the price increase will result in a drop in sales,its marketing manager disagrees because the demand for the waxed and coated paper is more than likely:

A) resistant
B) inelastic
C) derived
D) elastic
E) bundled

Question 62

The demand for consumer goods often affects the demand for business products.This characteristic of business markets is called _____ demand.

A) elastic
B) inelastic
C) fluctuating
D) derived
E) joint

Question 63

The distribution structure in business marketing typically:

A) includes at least one wholesaler
B) is direct
C) is complex and multistage
D) uses a three-step channel
E) uses retail distributors

Question 64

Inland Eastex manufactures a heavy paper stock that is used for printing covers for many different types and sizes of consumer magazines.Consumer magazine sales determine how much paper Inland Eastex sells.This is an example of:

A) joint demand
B) inelastic demand
C) elastic demand
D) congruent demand
E) derived demand

Question 65

All of the following are demand characteristics of business markets EXCEPT:

A) inelastic demand
B) fluctuating demand
C) joint demand
D) stable demand
E) derived demand

Question 66

Lanover Manufacturing supplies windshield wiper blades to General Motors and Ford.A sudden jump in the price of rubber and its substitutes has forced Lanover and other wiper blades manufacturers to double the price of the wiper blades.This increase in price has not affected sales volume for wiper blades.The price change did not change demand for windshield wiper blades because demand for this product by business customers is:

A) inelastic
B) secure
C) bundled
D) elastic
E) resistant

Question 67

Bàbolina Tetra is a Hungarian company that has genetically created a chicken that is guaranteed to produce uniform brown eggs with strong shells.It breeds and sells young chicks to farmers all over Europe who want to sell eggs in local markets.When consumers began to worry about cholesterol content and stopped eating as many eggs,the demand for the Tetra hen also declined.This would be an example of _____ demand.

A) derived
B) elastic
C) multiplying
D) bundled
E) inelastic

Question 68

When demand for a product is _____,an increase or decrease in the price of the product will not significantly affect demand for the product.

A) responsive
B) elastic
C) inelastic
D) derived
E) bundled

Question 69

Apple iTunes has sold over five billion downloads.Without iTunes the demand for the Apple iPod line of products would be small.Without the musicians there would be no iTunes.A condition of _____ demand exists.

A) bundled
B) incremental
C) functional
D) developmental
E) joint

Question 70

During the first years of this century,the number of packages arriving at households has more than doubled.An increase in the price of the cardboard boxes in which these packages are shipped will have little effect on the amount of shipping done; the demand for the boxes will continue to increase.Therefore,you know the demand for the cardboard boxes is:

A) resistant
B) inelastic
C) derived
D) elastic
E) bundled

Question 71

A decline in the availability of bicycle handle bars will decrease Huffy Bicycle Company's production of bicycles.Decreased production in turn reduces Huffy's demand for bicycle seats.This is because the products in this situation have _____ demand.

A) inelastic
B) joint
C) elastic
D) congruent
E) derived

Question 72

When the demand for packaged beer fell by 8 percent in one year,the demand for aluminum beer cans and glass beer bottles fell also because the demand for beer containers is an example of a(n)_____ demand.

A) joint
B) inelastic
C) elastic
D) fluctuating
E) derived

Question 73

Buyers in the business market tend to _____ than buyers in the consumer market.

A) use reciprocity less
B) purchase in much smaller quantities
C) buy more products that have a reduced probability of being affected by derived demand
D) generate more stable demand trends
E) be much more geographically concentrated

Question 74

Although the price of a chemical added to paint to protect surfaces from mold and mildew has almost doubled,the price of paint only rose an average of 5 percent,and the demand for both paint and the chemical that eliminates mold and mildew remained stable.The demand for this chemical is:

A) elastic
B) derived
C) bundled
D) inelastic
E) change-resistant

Question 75

Managers can use the NAICS data to:

A) create a more focused mission statement
B) eliminate risk
C) classify consumer behavior
D) identify potential new customers
E) determine purchase motives

Question 76

An acute shortage of heavy-duty tires is threatening to disrupt operations in mining and construction sites around the world.According to one mine operator,"I've got the coal and market,and I have the trucks to haul the coal,but I don't have the tires.I'd be willing to pay double the price if I could get the tires I need." The demand for heavy-duty tires is:

A) joint
B) inelastic
C) elastic
D) congruent
E) derived

Question 77

As a result of the _____,a small increase or decrease in consumer demand can produce a much larger change in demand for the facilities and equipment needed to manufacture the consumer product.

A) demand fluctuation principle
B) joint demand principle or division effect
C) inelastic demand effect
D) multiplier effect
E) derived force effect

Question 78

When two or more items are used in combination to produce a final product,they are said to have _____ demand.

A) derived
B) inelastic
C) joint
D) fluctuating
E) elastic

Question 79

Jif is the best-selling brand of peanut butter in the country.The manufacturer purchases large quantities of peanuts every year to manufacturer its product.This order size is an example of _____ and would give Jif an advantage over other buyers of peanuts.

A) purchase volume
B) joint demand
C) fluctuating demand
D) sales volume
E) multiplier effect

Question 80

Electric cars will increase the demand for electricity,which will then dramatically increase demand for the equipment needed to provide consumers with the electricity.This dramatic increase is due to the:

A) demand fluctuator principle
B) joint demand principle or division effect
C) inelastic demand effect
D) circumlocution effect
E) accelerator principle